4 Reasons why you should not store documents in cloud CRM

4 Reasons why you should not store documents in cloud CRM


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Gathering and storing your documents in a cloud CRM system can create massive legal and financial problems.

Many companies prefer to manage customer relations via the cloud. Unlike on-premise solutions, it provides great flexibility and convenience: you can access data from any device on the go and continue working from any location and time of the day. It also puts storage, maintenance and security on the shoulders of the service provider, and not yours.

However, collecting and storing your documents in a cloud CRM system is not recommended no matter how convenient it is. The financial, legal and reputational implications listed below may encourage you to reconsider your online document handling strategy and align your efforts with the best practices of using cloud CRM.

1. You may be infringing Data Residency Laws

Depending on the country where your business operates, your customers’ data may have to be stored within the country borders. For example, China requires all customer data to be hosted on China-based servers; Australia controls its health records; Germany keeps its telecommunications metadata; Russia demands all personal data to be hosted in the country and so on.

It hadn’t been like this before. The changes were rolled out between 2014 and 2017 after 2013 Edward Snowden revelations on the US National Security Agency collecting masses of private data not only from American citizens but from around the world. Now in many countries certain industries are required to keep customer data on in-country servers. In this way, they are subject only to this country regulations and can’t be, for example, searched under warrant either from the US or other countries.

Of course, these changes contradict the idea of cloud computing and free exchange of data. Moreover, for some companies, they make using cloud-based CRM systems impossible.

It is also true that some CRM providers attempt to keep up with changes. Salesforce is expanding their geographical representation. Dynamics 365 is opening new datacenters too in North America, Europe and Asia. Yet this variety doesn’t solve cloud computing issues of countries which are not on the list. And opening endless data centers is straightforward impossible. For many companies, the only option to stay within legal boundaries is to keep customers’ data and documents out of the cloud.

2. You risk GDPR fines

The General Data Protection Regulation effective since 25 May 2018 defines how personal information of EU citizens and residents must be handled. It also foresees serious penalties for violation.

What does this regulation mean for CRM? Most importantly, the issue of ultimate responsibility. When you are using a cloud-based system for your CRM, who is more responsible for adhering to the rules? Under the GDPR, you as a company are a data controller, and your cloud CRM system provider is a data processor. According to the Information Commissioner’s Office, controllers have more obligations under the GDPR than processors do, because they decide what personal data is collected and why, and exercise ultimate control over the information. Processors have fewer obligations and must be careful to only process personal data in line with the relevant controller’s instructions.

It means that if something goes wrong, you as a company are the ultimate to carry the responsibility and suffer financial and reputational losses, and not your CRM system vendor. Thus, having more control over customer data and documents is imperative nowadays.

3. You pay too much for storage

Although safety concerns are prevalent nowadays, the cost of data storage in the cloud also becomes critical for many companies. According to Salesforce reviews, its free data storage capacity is very small, and when free space is over, storage fees can get as huge as a yearly license itself.

Indeed, additional storage space from Salesforce is available in blocks of 50 or 500MB, with a price of $125/month for 500MB.

Other cloud CRMs as Dynamics 365, SugarCRM, Zoho and the rest come with cheaper storage, but it is easily exhaustible.

Frustrating as it is, one argument in defense of CRM providers: the system was created for customer relationship management and not for document storage. There are other tools for that!

4. You slow down your system

You are waiting and waiting for accounts to load, and it takes ages. Annoying, right? Complaints on cloud CRM systems slowing down are quite common on the web these days, and maybe you have experienced it yourself. But do you imagine how much excessive information your CRM processes every day? All invoices, purchase orders, reports, copies of IDs etc. sit in your system, steal its space and harass its processing capacity. Of course, there are other factors which influence the speed of your cloud CRM but storing documents is one of the gravest.

What to do about it?

Firstly, decide if you really need to keep documents in the cloud. Is it a habit or a must-have? If you realize that it is not needed, you can try moving all the documents to cheaper document storage systems manually or use software which does it automatically running at the background.

Alternatively, build a “cleanup” routine to get rid of old records like shipping confirmation records from years ago.

Finally, do some planning upfront. If you know that your organization will hoard masses of documents in your CRM system, prepare a mechanism so that it doesn’t impact your company’s performance halfway into important operations.

Thomas Berndorfer is CEO at Connecting Software (Vienna), a global provider of integration, synchronization and productivity solutions for business processes, holding Microsoft Gold and Silver competencies. Our clients are private and public organizations including the Government of Canada.